Archive for the ‘TILE Translations’ Category

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Bill Gates Learns to Give… Better

Tuesday, August 2nd, 2011

bill-gates-thinker.jpg
(photo credit: Steve Jurvetson)

Or, maybe, “Bill Gates learns to give to learn to teach so kids can learn?” Or something like that…

What we’re getting at here is that the Bill and Melinda Gates Foundation, by far the biggest charitable foundation in the world, has given away billions of dollars total, and hundreds of millions to education, however, they’ve had little measurable impact in the last ten years on the one thing they were really trying to change – how many kids from disadvantaged neighborhoods are going to college.

Luckily, the last 10 years in schools have taught Bill Gates something – that he needs to learn more! Taking an idea from the private sector and applying it to education, the Gates Foundation thinks that a little R&D is exactly what the educational system needs to come up with innovative solutions to its big problems. And that’s where he’s going to put his money now.

It turns out that the business world and non-profit world aren’t so different. A lot of what we do spending and growing our money has real impact on society and the environment, and things we do in one are of our financial lives can apply to other areas in new and cool ways.

It’s not always just about giving more, but about learning to give better.

Lolz! SEC Says WTF to Groupon Accounting Language

Friday, July 29th, 2011

social-media.jpg
(image credit: webtreats)

You know how (old) people are always saying that “texting and Facebook are the end of the world because kids can’t write anymore and say ‘u’ instead of ‘you,’ blah blah blah?” (like, omg, it’s nbd…)

Well, the SEC is now taking issue with the way Groupon and other start-ups are reporting their finances. Groupon, which is preparing for its IPO (i.e. selling shares of itself to the general public), is using some new – and misleading, according to a lot of financial experts and regulators – terminology to talk about how much money they are worth.

Other web and social media start-ups have done this sort of thing in the past – like talking about “eyeballs” (the number of people who view a website) instead of dollars to demonstrate a company’s value. However, some are saying Groupon is going too far, and others are saying stuff like “eyeballs” should never have been put next to traditional financial metrics in the first place.

So, do you think this is just an example of old finance not really getting the new way stuff works, or are Groupon and Zynga trying to punk us?

Apple Earnings Insanity

Wednesday, July 20th, 2011

apple-5-day-performance.png
(source: nytimes.com)

“Oh my god. Ohhh my god. Apple. Apple!!!!!!!”

– Intern Spencer, screaming as he watched the price of everyone’s favorite mega-corporation skyrocket to almost $400 per share.

(Just for fun, compare that with a maximum price of $9.54 per share in 2001.)

The reason for the sudden spike? Apple released its quarterly earnings report* on Tuesday evening, showing a record $28.57 billion in revenue. That’s $28.57 billion. In three months.

In the handy graph above, you can see investors getting excited about the upcoming earnings announcement on Monday and Tuesday, and then pretty much exploding with enthusiasm on Tuesday night.

What else would you expect from a company that has enough cash to buy almost every other mobile phone maker in the world, and that has enough fans in China to support an entire industry of counterfeit Apple stores?

* In the U.S., all publicly traded companies are required to produce earnings reports which disclose their sales numbers and net profit over the prior three months.)

Fund Scientific Research at 3AM

Wednesday, July 13th, 2011

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(photo credit: Mark Ramsay)

Heard of Kickstarter? That new site where anyone with an idea and a plan to make it happen can raise money from the unwashed masses? Well until now it’s mostly been used to help bands record their breakout albums, help designers raise capital to manufacture life-improving products, and help slightly off do-gooders pay for various swing-installation projects.

But now scientists are getting in on the action. From the Kickstarter-funded Mexican quail research expedition to the new academics-only crowdfunding site Open Genius, the doors are open for promising researchers to avoid the pain of securing traditional government and foundation funding.

Which means that you have a unique opportunity to directly impact research you care about. It’s one thing to donate to a cancer research fund (which is a totally awesome thing to do, by the way), but it’s another thing entirely to choose the lab you want to support.

This is also a great opportunity to exercise your advocacy muscles. With just a little prodding and a link to a well-designed website, you can double, triple, or quadruple your donation by talking to friends or posting your pitch online.

Never underestimate the power of peer pressure and one-click donations.

The Claw[backs]

Friday, July 8th, 2011

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(photo credit: mangpages)

It’s kind of an understatement to say that taxpayers were peeved when they ended up footing the bill for the government bailout of the “too big to fail” banks. So they may take some comfort in a new FDIC rule that will seriously punish the leaders of failed financial institutions. Among other things, it says that any executive responsible for the collapse of a major financial firm is subject to spooky-sounding “clawbacks.”

Clawbacks are the equivalent of making an executive return two years worth of their salary to the government if a government agency has to step in and handle the collapse. Big banks will also be required to have a plan in place before they go up in flames, to avoid the kind of sweeping support the government was forced to provide in 2008 and 2009.

That’s a lot of pressure on a relatively small number of people. What do you think – whose responsibility is it to keep a financial institution on the straight and narrow? Should employees lower on the corporate totem pole be punished as well?

Congress, Will You Raise the Roof?

Thursday, July 7th, 2011

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(photo credit: j thorn explains it all)

So much talk about the debt ceiling, so little explanation. The “ceiling” in this case is the limit of how much debt the U.S. government allows itself to take on. That’s why it’s up to Congress to decide what to do now that we’ve pretty much hit that limit. They can raise the roof and make it okay to go deeper in debt, or they can refuse, and the U.S. won’t have enough money to pay off some of the debt it already has.

But what does that mean to you? Conveniently, our friends over at Marketplace have explained why the debt ceiling is important to the average American in “How the debt ceiling affects the average American.” They use an actual example of an actual average American, who emerges from the conversation pretty shaken. (One side effect of the debt ceiling problem is that it freaks people out and makes then snap their wallets shut – otherwise known as shaking consumer confidence.)

Anyway, if Congress doesn’t agree to raise the debt ceiling, then the U.S. government won’t be able to pay its creditors back as promised. And just like a person who takes out a loan and then doesn’t pay it back, a default will lower America’s credit score (or credit rating, which is the national equivalent of a credit score). And with lower credit ratings come higher interest rates on future loans. After all, the bank is taking a bigger risk on you because you’ve shown in the past that you’re not the most reliable borrower. So they’ll let you borrow – but you’ll have to pay.

So what does this have to do with us average Americans, you ask with vague irritation? Well, generally what happens when interest rates increase for the government is that interest rates increase for everyone. So if you wanted to get a loan to buy a car or a house, you would end up paying a lot more for it. And if you have any credit card debt, those interest rates will go up, too. So instead of paying an extra 18% or 30% on the balance you’re carrying month to month, you’ll be paying something frighteningly larger.

Go ahead and see if you can survive the credit storm now, because if the roof isn’t fixed, the weather might be a lot more threatening in the near future…

Apparently Debt is the New Cigarettes

Thursday, June 23rd, 2011


(photo credit: paalia)

Now, debt isn’t necessarily a bad thing, okay? But this is a little crazy. For the past 25 years, people in their early and mid-twenties have reported feeling a thrill of maturity and self-confidence when they first started to dig themselves into the debt hole.

Whether the money was going toward education or just going into the “I’ll pay for this pizza later” pile, young adults – especially those in the lowest 25% of income earners – said they experienced greater “self-esteem and perceived mastery” when they began to run up a tab.

Some kinds of debt are better than others. In general, debt that can be considered an investment in something – like a home, or an education that can get you a better job – is a good thing. But debt that gets you nothing but fees, interest rates, and a pizza that has long since been digested and forgotten – i.e., credit card debt – is not good.

The most important factor in determining whether your debt is good or bad is whether you’re able to make payments in full and on time. If you don’t, your credit score will suffer and you’ll find yourself on the road to Massive Debt.

Which, by the time you reach 28 (according to the study), will start to make you feel kind of bad about yourself.

What’s up with Greece?

Wednesday, June 22nd, 2011

Greece.jpeg
(photo credit: David Spender)

You’ve heard that there’s a little trouble brewing in the glittering blue southeast corner of Europe, right? If you haven’t, Greece is in the middle of a nasty thing called a debt crisis. Basically, they can’t pay their bills, they’re gasping for air, and they’re pulling at ropes thrown by their European Union friends. So…

What’s the big deal? Why not let Greece’s failed economic policies fail? Who cares?

Fortunately for Greece, lots of people care. European nations (and investors throughout the world) see the Greek debt crisis as an infection that could spread throughout the EU and cause serious damage. Because nations in the eurozone all share the same currency (the euro), an economic disaster in one country will drag down the value of the currency for everyone.

So why hasn’t the problem been solved yet?

This (unbelievably) is the short answer, and definitely leaves out some of the finer points of the problem:

>>> Other EU nations have already stepped up and injected more than $100 billion into the Greek economy as a kind of bailout, but it’s just not enough. The Greek government has to cut spending and raise taxes in order to qualify for more aid, but citizens (and their powerful government reps) aren’t exactly excited about losing services and a bigger chunk of their paychecks.

>>> The government is also required to privatize some of its assets, which means selling valuable things like ports and banks and water utilities to private companies to raise cash. This also is not so popular – residents like their beautiful Greek coastline!

>>> Finally, private creditors (people who are owed money by Greece) have to agree to voluntarily hold onto and buy up more Greek debt (like government bonds). This is a hard sell in any case, but because publicly traded companies are legally obligated to act in the best interest of their shareholders, it may be especially hard to convince them that buying low-return debt in a failing economy is good for anybody.

What’s going to happen now?

Well, pretty much everyone involved agrees that they need to maintain a stable eurozone and a strong currency. So European nations are likely to keep trying to fix the problem any way they can. We’re not wizards over here at TILE, so we can’t say whether it will work, not work, or kind of work.

We will say that Greece is probably a pretty fun place to go right now if you’re looking for adventure civil-unrest-style!

Bulls Start to Sniff Around African Economy

Friday, June 17th, 2011

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(photo credit: ヘザー heza)

A company named Helios just unveiled its second big fund composed of equity investments in African securities. The entirely private-equity fund is the largest ever created in Africa, and it seems to show that investors are becoming more and more interested in the emerging markets there.

The idea behind investing in “emerging markets” is kind of the same as the idea behind buying low and selling high. Sure, there’s always the risk that a low-priced stock means it’s a bad company and you’ll lose money on your investment. But if the stock does well, you make money. Lots of money. Same deal with emerging markets.

Since investors are basically amateur fortune-tellers, constantly trying to predict how companies and markets will perform in the future, this new investment in Africa means that someone, somewhere, thinks that things are about to go really well in those emerging markets.

Stay tuned…

Here Come the Investomers…

Friday, June 17th, 2011


(image from loyal3.com)

In the very near future, you’ll be able to buy stock in a company you like by clicking three times within a Facebook app. Yes.

The start-up behind this investing revolution is Loyal3, and its goal is to make a boatload of money. But its other goal is to make it easy (and free) for average people to buy stock in the companies they like. And its other other goal is for companies to make it easy (and free) for average people to buy stock in their company, and thereby earn more loyal customers. Uh, investomers.

Amazing, right? The Internet and mobile technology have already revolutionized philanthropy – now anyone can donate $10 instantly with just a text message – so it was only a matter of time before the financial industry got in on the action. (Ahem.)

But this guy is a little concerned about making “mindless” investing available to the next generation. Why encourage people to buy stock without first giving them the proper tools for learning about the health of the company? Loyal3 could be a great opportunity for young investors who want to try out their growing knowledge about investing. But it could also be the next bad idea – we’ve seen the damage that can be caused by blindly handing money over to people who make promises without showing us what’s behind the curtain.

Would you buy stock on Facebook if there were no fees associated with it?

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